Tax & Accounting News

Warning over unpaid internships

24/08/2010

Firms which take on interns have been warned that they could be in breach of employment laws if they do not pay them for their services.

While internships have sometimes been seen as an opportunity for young people to gain experience of the workplace at little or no cost to the employer, a report from the Institute for Public Policy Research (IPPR) has claimed that internships are, in fact, covered by minimum wage legislation.

The organisation claimed that only just over half of firms currently paid the minimum wage, with 28 per cent paying a lower rate and 18 per cent paying nothing at all. It warned this could lead to a clutch of backdated claims for payment.

The IPPR has called on the government to provide clearer guidance to employers concerning the obligations they have to interns under employment law.

The government said it recognised the important role played by internships in helping young people gain work experience, but said it would study the report in detail and provide clarification if necessary.